Understanding Financial Basics for New Homeowners

Strengthen Your Credit Score

Your credit score is paramount in determining which home loan you can qualify for and the mortgage interest rate that accompanies it. While many factors are considered when applying for a mortgage, having an impressive credit score could lead to substantial savings overtime due to lower monthly payments.

How can you make sure your credit is in the best condition when it’s time to purchase? The professionals over at NerdWallet recently compiled a list of helpful tips that’ll help strengthen and build your credit. A few notable pieces of advice include:

• Monitor your credit and disputing any errors that show up on your reports.
• Pay your bills on time. This includes making loan payments and paying down any open lines of credit.
• Keeping your credit card balances low. Paying more than your minimum monthly balance when you’re able can help.

Streamline Your Savings for That Dream Home!

Are you unsure how to accomplish your dreams of saving for a down payment? Look no further than Bankrate’s advice! You can find assistance programs that may help reduce the amount needed, as well as tips on how to save more quickly. As noted in this article:

“One of the best ways to save for anything — including a down payment — is to set it and forget it. If you receive a regular paycheck, ask your employer to direct a portion of that payment into a savings account. If you’re a freelance worker or independent contractor, set up a recurring transfer from a checking account to a savings account to establish the routine.”

Get Pre-Approved

As you ready yourself for your upcoming purchase, it is essential that you understand both your budget and how much a lender would be willing to lend for the loan. That’s where pre-approval comes in! Pre-approval from a financial institution informs you of what amount of money can be borrowed towards the mortgage. Furthermore, combining this newfound knowledge with an understanding of one’s savings assists in determining which target price range to search within when looking at potential houses.

With that information in hand, you can begin searching for potential homes online and check out what is available in your locale within the price range you’ve set. This way, you will have an extensive list of options to imagine your upcoming home from!